“A broad spectrum anti-avoidance rule would compromise the certainty and stability that are vital to give businesses the confidence they need to make and maintain investments in the UK,” said John Cridland, CBI Director-General. He went on to point out that the UK should not introduce a test broader than that of other countries, such as China or Australia.

But ACT, which represents finance directors and treasurers of many of the UK’s largest companies, went further, suggesting the new rule could harm growth. “At this point in the economic cycle it would be a mistake to introduce something that chills growth and investments from not only indigenous but also foreign firms,” its submission stated.

“It would be very easy to damage the reputation of the UK as an attractive place to do business through introducing tax uncertainty around normal commercial business planning decisions.”